PT26.S3.Q24- over the last 25 years, the average price paid

Kristen BKristen B Legacy Member
edited February 2017 in Logical Reasoning 388 karma

Hello guys,

This was obviously a tough question, and after hours of tearing out my hair, I understand where the flaw is and why answer choice E is correct. Yet, there is still one component I am confused about.

Can someone in more detail explain how the individual income and car price could decrease, and individuals could still pay more today versus 25 years ago? Because, originally, I assumed it was erroneous to assume that people are spending more today on cars, if there income is substantially lower than in the past. I believe it relates to the proportion aspect, but I am still confused.

Thanks in advance,


  • nessa.k13.0nessa.k13.0 Legacy Inactive ⭐
    4141 karma

    Hi @"Kristen B" ! So we know nothing about the rate at which individual income could decrease and we also know nothing about the rate a which car prices could decrease. We don't know what rate those two factors could decrease in proportion to one another. Individuals could still pay more now, despite having lower income---that's usually what happens when economies crash like the crisis in Venezuela for example. We can't make any assumptions about those two phenomena in relation to one another regarding rate as we are not given that information. If income is lower in the past it is still possible for people to spend more on cars---maybe they go into more debt and take out loans, maybe people have money saved away in their bank accounts, maybe more people are gifted with cars, maybe less cars sell because people can't afford them. The point is income and spending are to separate factors. We can't assume anything.

    Does that help?

  • Kristen BKristen B Legacy Member
    388 karma

    Hey @"nessa.k13.0"! Thanks for the great explanation. I totally get it now.

  • nessa.k13.0nessa.k13.0 Legacy Inactive ⭐
    4141 karma

    You're welcome!

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